The developer behind the Libra (LIBRA) token has introduced another memecoin, raising concerns over suspicious onchain activities resembling those that signaled significant insider trading prior to LIBRA’s catastrophic 99% crash.
Hayden Davis, co-founder of both the Official Melania Meme (MELANIA) and the Libra token, recently launched a new Solana-based memecoin, WOLF, with insiders reportedly controlling over 80% of the supply.
WOLF was introduced on March 8, fueled by speculation that Jordan Belfort, famously known as the Wolf of Wall Street, was launching his own cryptocurrency. The token quickly surged to a peak market capitalization of $42 million. However, according to blockchain analytics platform Bubblemaps, 82% of WOLF’s supply was concentrated under a single entity, mirroring patterns seen in previous questionable launches. In a March 15 post, Bubblemaps noted:
“The bubble map revealed something unusual — $WOLF exhibited the same distribution pattern as $HOOD, another project linked to Hayden Davis. Was he involved in this one too?”
Further blockchain analysis uncovered transaction links between 17 different wallets, all tracing back to the address “OxcEAe,” reportedly controlled by Davis.
“He set up these wallets months in advance of launching $LIBRA and $WOLF, transferring funds through multiple addresses and blockchains,” Bubblemaps added.
WOLF’s value plummeted by over 99% within just two days, crashing from its peak market cap of $42.9 million on March 8 at 4:00 am UTC to a mere $570,000, as reported by Dexscreener.
Davis’s latest memecoin disaster follows the recent collapse of Libra, where eight insider wallets allegedly liquidated $107 million, causing the token’s $4 billion market cap to evaporate in hours. The fallout even entered the political sphere, as Argentine President Javier Milei faced potential impeachment due to his endorsement of the Libra token.
Prominent Argentine lawyer Gregorio Dalbon has called for Interpol to issue a Red Notice against Davis, citing concerns that his financial resources could enable him to flee or go into hiding.
Memecoins: A Growing Concern for Retail Investors
The rise of memecoins is shifting away from their community-driven origins, with many now being used as tools to exploit retail investors, according to Anastasija Plotnikova, CEO and co-founder of blockchain regulatory firm Fideum.
“Memecoins have transitioned from social experiments to a market dominated by value extraction schemes targeting retail investors,” Plotnikova told. She elaborated:
“Instead of the organic growth we once saw, insider rings, pump-and-dump tactics, and sniper groups now control the space, creating an unfair market environment.”
She emphasized that investors must differentiate between genuine collectible memecoins and outright fraudulent schemes like rug pulls, which are not just unethical but also legally prosecutable.
“In my opinion, these fraudulent practices should be firmly within the jurisdiction of law enforcement,” she added.
Meanwhile, U.S. regulators are ramping up efforts to tackle the growing issue of memecoin-related scams. A New York lawmaker has proposed legislation aimed at imposing criminal penalties for cryptocurrency fraud, particularly addressing deceptive schemes like rug pulls.
If enacted, the bill would establish specific criminal charges for fraudulent activities related to virtual tokens, reinforcing legal protections for investors in the volatile crypto market.
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